## Facts

- California entered fiscal year 1991–1992 facing a large projected budget shortfall; the 1991 Budget Act required a $351 million reduction in employee compensation but did not itself mandate wage cuts for state employees.
- The Department of Personnel Administration (DPA), acting as the State’s bargaining representative under the Ralph C. Dills Act, negotiated with unions representing employees in recognized bargaining units.
- Negotiations reached impasse in fall 1991.
- After impasse, DPA announced it would implement its “last, best offer,” including (1) wage reductions for employees in bargaining units and (2) changes to the State’s health care premium contribution formula.
- State employees and their unions sought mandate relief in superior court to block DPA’s unilateral implementation.
- The superior court issued a peremptory writ of mandate ordering DPA (and the State Controller) to desist from reducing wages and from changing the health care premium contribution formula.
- DPA petitioned the Court of Appeal for writ relief to require the superior court to vacate its judgment to the extent it barred implementation.

## Issues

1. Whether, after bargaining to impasse under the Dills Act, DPA had delegated statutory authority to unilaterally implement its last, best offer reducing employee wages.
2. Whether, after bargaining to impasse, DPA had delegated statutory authority to unilaterally implement its last, best offer changing the State’s health care premium contribution formula.
3. Whether a fiscal emergency or the Budget Act’s compensation-reduction target independently expanded DPA’s power to impose unilateral changes.

## Decision

- The Court of Appeal granted writ relief in part and denied it in part.
- The court held DPA had statutory authority, after impasse, to impose its last, best offer regarding health care premium contributions.
- The court held DPA lacked statutory authority, after impasse, to impose its last, best offer regarding wages.
- The court directed the superior court to vacate its writ to the extent it restrained DPA from implementing changes to health care premium contributions, but left in place the restraint against unilateral wage reductions.

## Legal Principles

- State agencies may act only within authority delegated by the Legislature; asserted post-impasse implementation powers must be grounded in statute.
- Under the Dills Act, bargaining authority and budgetary/appropriation control are distinct; legislative approval and appropriations constraints remain central for compensation decisions.
- “Wages” and “health care premium contributions” are legally distinct subjects; delegation may exist for one term of employment without existing for the other.
- A fiscal crisis and a budget directive to reduce compensation do not, without more, confer unilateral authority to reduce wages outside statutory mechanisms.

## Conclusion

The court held that DPA could unilaterally implement post-impasse changes to the State’s health care premium contribution formula because the Legislature had delegated that authority, but DPA could not unilaterally reduce wages absent comparable legislative authorization; the superior court’s restraint was therefore lifted only as to health premium contributions.


Dep’t of Pers. Admin. v. Superior Court, 5 Cal. App. 4th 155 (Ct. App. 1992)